Cambridge firms angry and ignorant about alternative funding

A third of SMEs in this region who applied for bank funding have been turned down.

As a result, nearly two thirds missed an important business opportunity, nearly 20% more than the national average, and 40% experienced cash flow problems.

The decision impacted owners/managers personally too; 40% said it increased their stress, 40% said it had a negative impact on their health and, for 20% of respondents, the decision made them angry.

A new survey from Liberis also revealed that East Anglian SMEs were less likely than the average UK small business to look for alternative funding. Fifty three per cent didn’t look elsewhere. Of that group, a quarter said they didn’t know where to look and a further quarter said they assumed they would be turned down by alternative funders too. Overall, 28% of the region’s small businesses, (higher than the national average of 21%), were not aware of any types of alternative sources of funding.

The majority of the region’s businesses (53%) needed funding for cash flow and a third needed finance for business growth and new stock. Cash flow management was cited as the biggest cause of worry for nearly a third of respondents.

Paul Mildenstein, Liberis CEO, said, “The economic crisis has created many new and innovative funding sources for small businesses. However, more needs to be done to inform and signpost them to what’s out there, so they can access working capital quickly and easily, which is what they need the most.”

Respondents were also interviewed on the personal sacrifices they make for their businesses and the region’s SMEs faired better than the national average.

Only 22% said they have sacrificed family holidays and 12% quality evening/weekend time with the family, compared to the national average of 34% and 36%.

Similarly, only 12% of respondents had sacrificed personal savings for their businesses, compared to the national average of 28%. Sacrificing a relationship, resulting in break-up or divorce was also lower than the national average too, with 9% of respondents citing it compared to 12%. alternativebusinessfunding.co.uk